Good Morning. My name is
John Howat. I am an Energy Project Manager at the National Consumer Law Center
(NCLC). At NCLC, we address the financial and legal problems faced daily by
low-income families - repossessions, debt collection abuses, electronic benefits
transfers, home improvement frauds, usury, bankruptcy, utility costs and terminations,
school loans, payday loans, sustaining home ownership, and more. In doing so
we help vulnerable consumers resolve financial crises, gain control over their
budgets and achieve economic independence. NCLC has offices in Boston and Washington
D.C. This morning I am representing the Low-Income Energy Affordability Network,
consisting of the non-profit and public agencies involved with the delivery
of energy affordability and efficiency programs to low-income households. I
wish to testify in favor of S. 141, establishing a self-sufficiency standard
in the Commonwealth.
The poverty definition in
use by the U.S. Census Bureau today has its origin in the Lyndon B. Johnson
Administration's attempts to keep track of its progress in the "War on
Poverty" during the mid-1960s. Aside from adjustments for inflation, the
formula used to establish poverty guidelines has remained unchanged, and no
longer accounts for the pricing and spending patterns prevalent in today's society.
Ongoing, localized tracking
of the cost of the "basket of goods" that comprise the products and
services needed to get by is necessary if we are to gain an understanding of
economic well-being. The existing poverty guidelines are just numbers-they do
not provide us with such understanding. Development of such an understanding
is prerequisite to our ability to develop appropriate policy and programmatic
responses to poverty, and strategies for its eradication.
From a practical standpoint,
I would point to the use of the existing poverty definition in the administration
of low-income energy affordability and efficiency programs in Massachusetts.
While the existing definition may serve as a tool in the allocation of benefits
that are available, it is merely an arbitrary gauge of the extent to which we
are assisting the households that are actually in need. In the case of fuel
assistance, for example, we use a maximum eligibility guideline of 200% of the
federally determined poverty level, and base benefit levels on the ratio of
household income to poverty. These guidelines provide no clear indications of
the extent to which we are under-serving or over-serving actual need for assistance.
Program delivery agency personnel hear regularly from households with incomes
above these guidelines that there is need for assistance. However, the poverty
guidelines themselves are inadequate to address the issue empirically.
There are those who will
say that, "changing the definition of poverty to more accurately reflect
need will merely put more pressure on government to do more to solve poverty-related
problems. Government can only do so much," they will say, "and we
can't be all things for all people."
While it may be true that
government will not solve all of society's problems overnight, it is unconscionable
to turn our collective back and give up on those who simply lack the resources
to get by in today's economy. Our best efforts to deal with problems of poverty
must be based on reliable, useful information. Adopting the changes contemplated
in S. 141 would be a great start in developing such information. Thank you very
much for your time and consideration of this important matter. I welcome any
questions that you may have.
and NCLC